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U.S. prevails in trade dispute with China
Published on: 2010-10-25
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WASHINGTON — The United States claimed victory Friday in a trade dispute with China, after a World Trade Organization panel largely upheld tariffs that were imposed on an array of Chinese-made steel pipes, tires and other products during the Bush administration.

China had used a number of technical arguments in a September 2008 challenge to antidumping duties, which are supposed to compensate for unfair pricing and countervailing duties that are used to offset improper government subsidies. But a W.T.O. dispute settlement panel rejected most of those arguments.

The Bush administration announced levies on $200 million of steel pipe shipments from China, South Korea and Mexico in July 2008, a month after imposing similar countervailing duties involving a different kind of steel pipe. The Obama administration has defended those decisions.

"This is a significant win for American workers and businesses affected by unfairly traded imports,” said the United States trade representative, Ron Kirk. “This case makes clear that the Obama administration, including U.S.T.R. and our colleagues at the Department of Commerce, will vigorously defend the application of our trade remedy laws.”

The duties that were upheld on Friday had been imposed on a variety of specialized goods: circular welded pipe, certain pneumatic off-road tires, light-walled rectangular pipe and tube and laminated woven sacks.

China’s challenge revolved around many technical questions, including whether state-owned enterprises and state-owned commercial banks could be properly considered public bodies that provide subsidies.

The ruling comes at a time of increasing tensions over currency and trade between China and the United States. The Obama administration has agreed to investigate a complaint brought by the United Steelworkers over China’s support for its clean energy industries, and is concerned about Chinese efforts to block exports shipments of valuable minerals known as rare earths.

"These findings are especially important at a time when the United States is vigorously implementing W.T.O.-consistent tools to address China’s unfair trade practices and to address global imbalances,” said Representative Sander M. Levin, Democrat of Michigan, one of the most outspoken House members on China’s decision to hold down the value of its currency, the renminbi. “We should not let the possibility of meritless allegations of W.T.O. inconsistency prevent us from standing up for U.S. workers and businesses.”

The W.T.O. panel was established in January 2009 and held hearings in July and November of that year. Both China and the United States have up to 60 days to appeal the panel’s ruling, which ran to 283 pages and was published on the Web site of the W.T.O., which is based in Geneva. China joined the organization in 2001.

In a separate case, the United States International Trade Commission, an independent federal agency that assesses whether imports unfairly damage American industry, on Friday authorized the Commerce Department to impose both antidumping and countervailing duties on coated paper from China and Indonesia that is used in sheet-fed presses.

The commission found that the papers, which are used to produce high-quality graphics, had been unfairly subsidized and sold in the United States at less than market value.

Senator Sherrod Brown, an Ohio Democrat who had submitted testimony to the trade commission in the coated-paper case, applauded the ruling.

"American producers face an inexcusable flood of dumped Chinese paper — subsidized from 10 to 15 percent of product cost,” he said after meeting with workers at Smart Papers, a coated-paper manufacturer in Hamilton, Ohio.

Mr. Brown said the decision “shows why rigorous trade law enforcement is critical to the economic security of our workers and viability of domestic manufacturing,” but he also argued that China’s currency policies should be considered in future trade remedy cases.

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